Web Date: September 20, 2012
BASF To Pay $1 Billion For Becker Underwood
BASF will buy agriculture firm Becker Underwood for $1.0 billion from its private equity owner, Norwest Equity Partners. Based in Ames, Iowa, Becker produces biological seed treatments and seed treatment colors and polymers. It also offers biological pesticides, animal nutrition products, and landscape colorants and coatings.
BASF expects Becker to achieve $240 million in sales in its current fiscal year. It has 10 production sites worldwide and employs 479 workers. The majority of Becker’s product lines will be added to BASF’s crop protection division, in a new functional crop care unit, and the animal nutrition business will become part of BASF’s nutrition and health division. The transaction is expected to close by the end of the year.
BASF says the acquisition will help it expand its offerings in the growing seed treatment market. In recent years, rising costs for genetically modified seeds have prompted a rapid increase in seed treatment sales as farmers strive to protect the pricey seeds from fungi and insects. The best-selling seed treatments contain neo-nicotinoids, which have been identified by researchers as a possible contribution to honeybee deaths. Newer treatments based on microbes are expected to take a growing share of the market.
In a similar deal, Swiss agricultural chemicals firm Syngenta has agreed to buy U.S.-based Pasteuria Bioscience for $86 million plus deferred payments of up to $27 million. Pasteuria is a biotechnology firm that specializes in controlling nematodes that are parasitic to plants.
Nematodes feed on roots, reducing the flow of water and nutrients into the plant. According to the company, nematodes cause $100 billion annually in crop damage worldwide and are difficult to control. Pasteuria’s products are derived from the soil bacterium Pasteuria spp. Its first product, a seed treatment to control the soybean cyst nematode, will launch in the U.S. in 2014.
The BASF and Syngenta deals follow Bayer CropScience’s recent acquisition of biological pesticide maker AgraQuest and Monsanto’s September announcement of an alliance with pharmaceutical firm Alnylam to develop biopesticides based on RNAi technology.
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